Ensuring a Policy for Success

December 30, 2008

The following post is a story from our very first newsletter published a year ago. Since then, Equitable Life has continued to reap the benefits of applying The Tatham Method to their operations, and has continued training its employees to think differently, to challenge status quo and to always improve the customer experience.

Kitchener-Waterloo, July 2007 – In just two short years, Equitable Life of Canada (Equitable) has gained more than 30% in capacity and productivity in the areas that they focused on. It has achieved at least $785,000 in savings annually and is transforming its culture to being a flexible, customer-centric, demand-driven company.

While to some these improvements may seem bland, for Equitable – a well-established mutual life insurance company based in Waterloo, Ont. – they translate into much more: an improved work environment, happier customers, consistent results and streamlined activity — and that, is priceless.

The secret? It’s in two words: Boot Camp.

Now, if you’re like most people, you’re picturing a surly drill sergeant barking orders to a group of miserable individuals, huffing and puffing their way through impossible exercises.

But this Boot Camp is different. It’s a two-day, hands-on experience, where participants run a fully operational company and learn how to change the way they operate. It allows companies to find their hidden capacity and achieve breakthrough results without resorting to any additional capital. More importantly, it’s the gateway for a much greater journey: the beginning of a transformation in sustaining these changes.

And that’s exactly what Ron Beettam, President and Chief Executive Officer of Equitable wanted in order to take the company to the next level.

It all began in February 2005, when Equitable welcomed Beettam, a 25-year veteran of the industry. “I knew it was a solid company with lots of great people, but it was very internally focused. The board wanted to see the company grow and expand,” he said.

Although Beettam had a clear vision, his colleagues explain what would need to change. “Before Ron [Beettam] came on board, things were rigid, change was arduous and slow,” says Michael Dawe, Vice President, Individual.

“There was no sense of urgency or competitiveness and people were still stressed,” adds Chris Kosumovic, one of Equitable’s resident Tatham experts.

Beettam says, “I spent the first six months at Equitable asking people why they did things a certain way. Their reply was ‘that’s the way it had always been done’. At a prior company, I brought in The Tatham Group because it was effective in establishing formal processes to improve quality, productivity and efficiency.”

Beettam knew Equitable needed to change, and his answer was to use The Tatham Systematic Method. But first, he would need to introduce his team to the concepts. In February 2006 he and Equitable’s executive management went to their first Boot Camp.

Sherry Kinsman, Director, Group Systems explains what happened next. “After Boot Camp, there was a lot of excitement. Even though we had failed spectacularly, we could all imagine what kind of company we would be if we got from Push to e-Pull.”

Management immediately jumped into applying the Tatham Method by selecting two processes and assigning teams to tackle their issues.

The Claim to Fame team worked on faster processing time for group health claims. Delivery time dropped from eight days to 1.5 days, adjudicators went from processing 51 claims per day to 148 claims per day and the company saw a savings of $2.29 per claim.

Kinsman says, as a result they were able to leverage this experience against the process used for dental claims. “Staff began questioning certain practices. Without going through the entire method they shortened the time to process a claim from seven days to five days.”

The second team, Write In Right Out, streamlined the process of obtaining individual life insurance policies. Although the redesign went well, it became clear that it affected other business areas and eventually got rolled into the Individual New Business team’s improvements – who found a 40% capacity gain after redesigning their processes.

Then, in August of 2006, Equitable launched Freedom 15, a team looking to cut delivery time for quarterly financial reports in half – from 30 days to 15 days. Financial Analyst and team leader Hein Low says, “As one guy put it, we were making a hundred ‘Model A’s’, when we only needed one. Since redesigning the process, we achieved our goal and now we’re improving the quality.”

Kinsman, a trained Boot Camp facilitator, talks about the year in retrospect. “It was exciting to re-design things that hadn’t been touched in years. The first few teams really showed us how the company was operating because in Boot Camp, we kept failing ‘Pull Corp’. So Ron [Beettam] set a new goal: if we could beat the 40 minutes allowed for Pull, he would know the culture was shifting. I think the record is now 15 minutes.”

These successes are literally written all over the walls: posters, boards, sticky notes, rooms full of charts and process maps – all evidence of tracking progress and performance and a clear signal that process improvement is there to stay.

It was also a sign to Beettam that the company was turning a corner. In February of 2007, he re-vamped his management team and drafted nine key initiatives that would help achieve the year’s corporate goals.

According to Marilyn Major, another in-house Tatham specialist, these initiatives set out significant milestones. “We created nine teams and since then we’ve surpassed our targets to achieve a productivity gain of 30%. We’ve also developed dashboards to continue monitoring our progress and we’re launching the new initiatives for 2008.”

But some senior managers are cautious about declaring a premature victory.

Chris Brown, Vice President of Human Resources says, “There are four classic stages of a team: forming, storming, norming and performing. We’re in the forming and storming stages. As teams evolve we’ll move into norming and with time and experience it will become ingrained in the culture and that’s what I call performing.”

He adds, “The way to keep it going is through positive reinforcement, setting up management processes to measure sustainability, and keeping people focused. We’ve created ‘On-the-spot’ awards, and we’ve dedicated a number of full-time employees to making sure this is moving forward. ”

Dawe agrees. “We’re just getting the ball rolling now, and it’s starting to hit the important areas. It’s too soon to say there has been a real culture shift, but people are seeing positive results and they’re starting to be more comfortable with questioning how they can make things better. Now, it’s a matter of using the Tatham process, getting consistent results and building sustainability in repetition. ”

For Beettam, however, this is a way of thinking. “I will stop doing this work when I see improvements stop or slow down. And I don’t see that happening in the foreseeable future.”